Middle East Business News Review – 12 November

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Today’s top business and economy news from the Middle East and North Africa:

Dubai sees no need to recapitalise support fund

Dubai sees no need to recapitalise the financial support fund which provides aid to indebted state-linked companies, Sheikh Ahmed bin Saeed al-Maktoum, the head of the emirate’s Supreme Fiscal Committee, said on Monday.

“No, we do not need to do anything like that. All the companies are doing well,” Sheikh Ahmed told reporters in response to a question.

Sheikh Ahmed did not specify how much money was left in the Dubai Financial Support Fund, saying he did not remember the exact figure.

World’s tallest hotel makes Dubai debut

The first tower of the world’s tallest hotel, JW Marriott Marquis Hotel Dubai, has opened its doors adding 804 rooms.

Officially recognised as the world’s tallest hotel at a height of 355 metres, only 26 metres short of the Empire State Building in New York, the JW Marriott Marquis has been dubbed Dubai’s first world-class convention and business destination hotel.

The hotel is opening in several phases, with its first tower of 804 rooms and suites in its soft opening phase, and with three of the final nine restaurants.

Emirates defies aviation gloom to double profit

Emirates, Dubai’s flagship carrier, doubled its first-half profit, carried more passengers and surged ahead with its growth plans, leaving its struggling European and Asian rivals trailing.

The government-owned airline, along with other state-backed Gulf carriers Qatar Airways and Etihad Airways, has invested in new routes as European airlines, hit by high fuel costs and a global market slowdown, cut costs and shelve growth plans.

Emirates and its home base Dubai are betting that its location – a third of the world’s population is within a 4-hour flight radius – will continue to attract passenger traffic away from other global hubs such as London, New York and Singapore.

Riyadh to allow subscription rights trade on stock market

Saudi Arabia’s Capital Market Authority announced on Monday it will allow subscription rights for share offers to be listed and traded on the Saudi stock market, as part of its drive to modernise the market while it prepares foreign investors’ entry in the market.

Abdulhamid Abu Dahesh, a Saudi financial adviser, said the announcement is a step forward and that the new framework was developed in accordance with the stock markets in Europe.

Saudi Arabia financial authorities insist they are making preparations to open its stock market, the largest in the Arab world, to direct investment by foreign institutions. However, they are reluctant to give a date for the reform apparently because they are concerned about the possible destabilisation of the market.

Makkah slumdwellers fear eviction as high rises multiply

Close to Saudi Arabia’s Grand Mosque in Mecca and the glitzy five-star hotels surrounding it lie slums whose mostly immigrant dwellers fear they will be evicted to make way for new high rises and malls.

In one such slum on Jabal (mount) Omar, humans, cats, lizards, and mosquitoes co-exist among piles of garbage, with sewage running openly along the narrow tracks on the rugged hill.

The impoverished neighbourhoods are divided by nationality, with the Yemeni quarter at the bottom of the hill, then the Africans and finally, at the very top, the Burmese, residents say.

SocGen nears sale of Egypt stake to Qatar’s QNB

Societe Generale is nearing the sale of its majority stake in an Egyptian bank to Qatar National Bank (QNB), sources familiar with the matter said, in a move to help shore up the French lender’s capital base.

QNB, part-owned by Qatar’s sovereign wealth fund, will also make a mandatory offer to minority shareholders for the remaining 23 percent of Egypt’s National Societe Generale Bank (NSGB), the sources said.

The two deals will value all of NSGB at about $2.6bn, three sources told Reuters, speaking on condition of anonymity as the matter is not public.

Gulf Air amends plane orders to save $2.5bn

Bahrain’s Gulf Air said on Monday that it has won approval from Airbus and Boeing to amend plane orders in a bid to save more than $2.5bn.

The national carrier said in a statement that it has signed amendment agreements with both aircraft manufacturers to “realign its original orders to meet its long-term strategic needs”.

Gulf Air has been in extensive discussions to renegotiate its order book since 2011, it said.

Iran, Venezuela sign agreements to build oil reservoirs, refineries

Iran announced on Monday it will make investments worth $200 million in Venezuela to build four oil reservoirs and refineries for storing and refining oil products.

Semi-official Fars News Agency reported that in addition to the deals, Iran will also design and construct some small refineries in the Latin American nation.

The tanker is one of the four tankers ordered by the Venezuelan company and built by Iran Marine Industrial Company (Sadra).

Telecom Egypt eyes deal with government on mobile service

Telecom Egypt is in advanced talks with the government on a deal allowing it to offer mobile services in addition to its traditional mainstay fixed-line business, where revenue is under pressure.

Telecom Egypt, which is 80 percent owned by the state, has been relying on its data business to boost revenue. It also has a 45 percent stake in Vodafone Egypt, which in the third quarter accounted for a third of net profit.

US to become world’s top oil producer by 2017 – IEA

Forecasts by the International Energy Agency (IEA) on Monday said the United States will overtake Saudi Arabia and Russia as the world’s top oil producer by 2017.

The Paris-based energy organisation predicted that Washington will come very close to achieving a previously unthinkable energy self-sufficiency.

The latest report comes in stark contrast to previous IEA reports, which said Saudi Arabia will remain the top producer until 2035.

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